SOURCE: Stora Enso Oyj

January 25, 2008 02:23 ET

Stora Enso, Anaika Group and Empower take the first concrete steps to sustain economically viable employment in Kemijärvi and Kymenlaakso

HELSINKI, FINLAND--(Marketwire - January 25, 2008) - Stora Enso Oyj Press Release 25 January 2008 at 07:00 GMT

Stora Enso has signed a letter of intent with Anaika Group to sell part of the Kemijärvi Mill real estate to Anaika Group to enable it to start a high quality engineering works and gluelam beam operations at the mill site. When in full production, Anaika Group's operations will employ about 100 people directly and provide substantial indirect employment in the region. Anaika Group will itself develop the production facilities.

Stora Enso has also signed a letter of intent to outsource the maintenance operations of its Anjala and Kotka Mills in Kymenlaakso to Empower Oy, which will offer approximately 100 jobs to Stora Enso employees affected by restructuring measures. In addition, subject to the scope of the final agreement, about 200 current Stora Enso maintenance employees not affected by the ongoing restructuring would be transferred to Empower. Empower offers great local employment opportunities for Stora Enso professionals.

"Our goal has been and remains to secure domestic supplies of fibre for our large integrated pulp and paper mills with over 2 000 employees in Veitsiluoto and Oulu, while also finding long-term solutions for our employees made redundant through the mill closures in Kemijärvi and Kymenlaakso. Stora Enso has in co-operation with the Finnish government tried to find solutions for Kemijärvi and Kymenlaakso. Today we can announce the first concrete steps. We hope all parties will support these efforts and further steps to come," said Stora Enso CEO Jouko Karvinen.

Aulis Ansaharju, EVP, Stora Enso Fine Paper and Country Manager Finland, elaborated: "The agreement to establish an engineering works and gluelam beam business in Kemijärvi will directly provide about 100 local jobs. In addition, about 50 employees have the option of retiring. This already provides a solution for about two-thirds of those directly affected by restructuring, but we are also working to find more opportunities.

"Also very importantly, the long-term supply agreement with Anaika Group will provide sawlogs to Anaika Group for gluelam beam production and chips as a by-product to Stora Enso. This will strongly support our objective of securing domestic supplies of fibre for the Veitsiluoto and Oulu Mills, which directly employ over 2 000 people and provide indirect employment for many times more. Finally, this agreement will support our objective of increasing domestic wood sourcing. In 2007 we increased domestic sourcing by three million cubic metres, adding EUR 150 million and 450 man-years of employment to the local economy. We want to decrease the amount of wood imported and increase domestic sourcing."

Stora Enso will offer the required real estate to Anaika Group on favourable terms and issue a vendor note. This EUR 7 million capital loan is in addition to Stora Enso's already reserved EUR 10 million voluntary support package, which was announced earlier to help the personnel affected to find new employment. The Finnish government will also provide financial support to this transaction.

The final agreements with both these companies are scheduled to be signed at the latest during this spring.

For further information, please contact:
Jouko Karvinen, CEO
tel. +358 2046 21410

Aulis Ansaharju, EVP
Fine Paper and Country Manager, Finland
tel. +358 400 480 984

Kari Vainio
EVP, Corporate Communications
tel. +44 7799 348 197

Keith B Russell
SVP, Investor Relations
tel. +44 7775 788 659

Ulla Paajanen-Sainio
VP, Investor Relations and Financial Communications
tel. +358 40 763 8767

Anaika Group Ltd Oy is a Finnish technology growth company established in 2004 that designs, manufactures and operates products and complete process systems for the mechanical wood processing industry. It also has engineering works and provides consulting services.

Empower Oy is one of the largest service providers in the energy, telecommunications and industrial sector in Finland and the Baltic States. Empower operates in dozens of locations in Finland, the Baltic States and Russia. Empower has turnover of EUR 161 million and about 2 000 employees, including 700 in the Baltic States.

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